Tempo Beverages: How Much Cash Is Really Left After GBC, Debt, And The Dividend
Tempo generated NIS 502.9 million of operating cash flow in 2025, but on an all-in cash view it still needed NIS 106.2 million of additional short-term funding to finish the year with NIS 49.0 million of cash. The bond deed is not the bottleneck here. Capital discipline and funding rollover are.
The main Tempo article already made the larger point: the real question for 2026 is no longer whether the local business can produce profit. It can. This follow-up isolates the narrower question that matters most now for anyone reading Tempo through a credit and capital-discipline lens: after GBC, after debt service, after leases, and after the dividend, how much cash is really left.
The short answer is less comfortable than the NIS 502.9 million operating cash flow headline. On an all-in cash flexibility view, meaning cash left after the year's actual cash uses, 2025 did not close from internally free cash alone. It closed after a net increase of NIS 106.2 million in short-term credit. Without that layer, the annual bridge would have ended roughly NIS 92.1 million negative.
That is also the key difference between a profit read and a liquidity read. A narrower normalized / maintenance cash generation lens would look better, because the core business still throws off a lot of cash before acquisitions, distributions, and strategic uses. But that is not the right lens here. The thesis is not about recurring earning power in the abstract. It is about how much room the company actually had left after what it really did in 2025.
Four numbers frame the issue:
- Operating cash flow reached NIS 502.9 million, but investing cash outflow jumped to NIS 330.1 million.
- Financing cash outflow was still NIS 158.8 million even after a NIS 106.2 million net increase in short-term credit.
- At December 31, 2025, Tempo reported a consolidated working-capital deficit of about NIS 16 million and a solo working-capital deficit of about NIS 302 million.
- After the balance-sheet date, the 2018 bank loans of NIS 100 million were repaid in February 2026, and another NIS 60 million dividend was approved on March 26, 2026.
What Was Actually Left From Cash Flow
The right way to read this is through a simple analytical bridge built only from the reported cash flow lines. It is not a separate reported metric, but it is the cleanest way to test how much room remained after the year's real cash uses.
That chart says something very simple. The NIS 49.0 million year-end cash balance was not a cushion left after the business had already funded the year on its own. It was what remained after the company also increased short-term funding. That is the real point. Tempo did not enter 2026 with a cash balance built only out of the operating engine. It entered with a balance that also leaned on bridge funding.
This also helps explain why net finance expense almost doubled to NIS 70.7 million from NIS 37.4 million. Of that, NIS 37.5 million was bank interest, NIS 18.8 million came from fair-value changes in derivatives, NIS 9.6 million was lease-related interest expense, and NIS 7.8 million came from the change in present value of the exercise premium tied to the non-controlling holders. In other words, the stronger cash flow did not arrive in a cheap capital structure. Holding the balance sheet already costs meaningfully more.
The year-on-year contrast matters too. In 2024 the company reduced short-term credit by NIS 88.8 million and still ended the year roughly flat in cash. In 2025 that picture reversed. Short-term funding no longer released cash. It was needed to keep the year positive. That is not the same thing as an immediate credit event. It does mean the gap between profitability and free room has narrowed.
Short-Term Funding Is No Longer A Footnote
The short-term funding note makes clear how central this layer has become. At December 31, 2025, short-term bank and other credit stood at NIS 500.2 million versus NIS 385.2 million a year earlier. That balance included NIS 388.1 million of short-term bank loans, NIS 100.0 million of commercial paper, and another NIS 12.1 million of current maturities of long-term loans.
That chart is useful because it removes the comfort of the single cash line. Year-end cash, NIS 49.0 million, was roughly the size of current lease maturities alone. Against it sat NIS 388.1 million of short-term bank loans, NIS 100 million of commercial paper, and NIS 22.6 million of current bond maturities. This is not a picture of cash independently covering the short-term funding stack. It is a picture of a system that keeps working through rollover.
The contractual maturity note says the same thing from a different angle. Contractual cash flow on overdrafts and short-term bank and other loans was NIS 522.4 million, including NIS 514.0 million within six months and another NIS 8.4 million within six to twelve months. Not all of that should be read as a dramatic wall, because Tempo is a seasonal operating business and part of the structure is expected to roll. But that is exactly the point: flexibility depends on continued rollover availability.
Tempo itself states the counterargument explicitly in the board report. The company acknowledges the working-capital deficit, both consolidated and especially solo, but says it does not see a liquidity problem because of recurring profitability, NIS 442 million of consolidated EBITDA, positive operating cash flow, and still-available bank facilities at the date of approval. That is the strongest counter-thesis here, and it is a serious one. Tempo does not read like a borrower locked out of funding. It reads like a company that continued to finance growth and distributions through an open credit system.
But once framed that way, the real risk also becomes clearer. If 2026 brings a more prolonged cold-market slowdown, heavier working capital, or slower release of inventory and receivables through the strong season, short-term credit will stop looking merely like a convenience layer. It will look even more like a structural support.
| Key short-term item | 2024 | 2025 | What it means |
|---|---|---|---|
| Cash and cash equivalents | 35.5 | 49.0 | Cash rose, but not in proportion to the wider liability base |
| Short-term bank and other credit | 385.2 | 500.2 | Bridge funding expanded by NIS 115.0 million |
| Commercial paper within short-term credit | 50.0 | 100.0 | The institutional short-term layer doubled |
| Suppliers | 371.7 | 420.7 | Operating payables also helped fund the cycle |
| Current lease maturities | 45.5 | 48.2 | Lease burden remains meaningful at the cash level |
| Net finance expense | 37.4 | 70.7 | The cost of the balance sheet rose much faster than comfort would suggest |
The Bond Deed Is Loose. Cash Is Not
This is the most interesting part of the whole picture. Anyone reading only the Series C bond deed can come away thinking Tempo is far from stress. That reading is correct. But that is exactly why the real test has shifted away from the word covenant and toward the phrase capital discipline.
Legally and accounting-wise, the company still has room. At December 31, 2025, distributable retained earnings stood at about NIS 824 million. Equity was NIS 949.9 million, and the equity-to-assets ratio was about 36.4%. The bond deed thresholds sit much lower.
| Test | Bond deed threshold | 2025 position | Correct read |
|---|---|---|---|
| Wider dividend lane | Equity of NIS 725 million or more after distribution | Actual equity NIS 949.9 million | Wide headroom |
| Mid dividend lane | Equity of NIS 300 million or more after distribution | NIS 949.9 million | Not restrictive |
| Distribution stop | Equity below NIS 255 million after distribution | NIS 949.9 million | Very far away |
| Interest step-up trigger | Equity-to-assets below 17.5% | About 36.4% | Far away |
| Acceleration trigger | Equity-to-assets below 15% or equity below NIS 250 million for two quarters | About 36.4% and NIS 949.9 million | Not close |
Even after the NIS 60 million dividend approved on March 26, 2026, the December 2025 equity base would still remain above the NIS 725 million lane. So the real limitation is not legal capacity and not the deed. The practical bottleneck is cash. That is the exact gap between accounting room and cash room.
The picture tightens further once the post-balance-sheet events are added back in. First, the long-term bank loans originally granted in February 2018, totaling NIS 100 million, were repaid in February 2026. Second, only weeks later, another NIS 60 million dividend was approved for payment on April 30, 2026. So even if the bond deed looks comfortable, 2026 did not start from the same liquidity position implied by the December 31 cash line alone.
That is also where the next real test sits. If Tempo can maintain strong operating cash flow, release working capital through the peak season, and avoid another meaningful rise in short-term credit, 2025 can still be read as an aggressive but controlled year. If short-term funding keeps rising even after the acquisition year, the implication will be different: expansion and distributions are no longer funded only by the business itself, but also by continued openness of the credit system.
Conclusion
Tempo does not read here like a company drifting toward a deed breach. If anything, the opposite is true. Equity is high, the equity ratio is wide, and the company states explicitly that it complies with all deed terms and does not fully use its available credit lines. So anyone looking for the issue only through a covenant-against-threshold lens is looking in the wrong place.
The issue, or more precisely the real test point, sits elsewhere. 2025 showed that the business is strong, but it also showed that after GBC, debt service, leases, and dividends, almost no meaningful cash room was left without help from short-term funding. That is not a sign of immediate distress. It is a sign that the Tempo discussion has moved from profitability to capital discipline.
Over the next 2 to 4 quarters, the market will not need another proof that Tempo knows how to sell beverages. It will need proof that Tempo can sustain expansion and distributions without turning short-term funding into an ever more permanent layer of the capital structure. That is what will determine whether 2025 was a one-off aggressive investment year, or the start of a tighter funding model.
Disclosure: Deep TASE analyses are general informational, research, and commentary content only. They do not constitute investment advice, investment marketing, a recommendation, or an offer to buy, sell, or hold any security, and are not tailored to any reader's personal circumstances.
The author, site owner, or related parties may hold, buy, sell, or otherwise trade securities or financial instruments related to the companies discussed, before or after publication, without prior notice and without any obligation to update the analysis. Publication of an analysis should not be read as a statement that any position does or does not exist.
The analysis may contain errors, omissions, or information that changes after publication. Readers should review official filings and primary sources before making decisions.